Exhibit 99.4
Birner Dental Management Services, Inc.
3801 East Florida Avenue, Suite 508
Denver, Colorado 80210
303-691-0680
FOR IMMEDIATE RELEASE
November 4, 2003
BIRNER DENTAL MANAGEMENT SERVICES, INC.
ANNOUNCES 13.1% NET INCOME INCREASE
FOR THE 3Q '03 VERSUS 3Q `02
DENVER, COLORADO, November 4, 2003...Birner Dental Management Services, Inc.
(NASDAQ SmallCap Market: BDMS), operators of PERFECT TEETH dental practices,
announced results for the quarter ended September 30, 2003. The Company reported
net income increased 13.1% to $298,000, or $.21 per share of common stock on a
diluted basis for the quarter ended September 30, 2003 compared to net income of
$264,000, or $.16 per share of common stock on a diluted basis for the quarter
ended September 30, 2002. For the quarter ended September 30, 2003, net revenue
decreased $21,000 to $7.5 million, or 0.3% when compared to net revenue of $7.6
million for the corresponding period in 2002. Total dental group practice
revenue increased $151,000, or 1.4% to $10.8 million for the quarter ended
September 30, 2003 compared to total group practice revenue of $10.7 million for
the quarter ended September 30, 2002. The Company's earnings before interest,
taxes depreciation and amortization (EBITDA) for the quarter ended September 30,
2003 was $1.1 million compared to $1.2 million for the corresponding period in
2002.
For the nine months ended September 30, 2003, net income increased 18.8% to
$884,000, or $.60 per share of common stock on a diluted basis compared to net
income of $744,000, or $.46 per share of common stock on a diluted basis for the
nine months ended September 30, 2002. For the nine months ended September 30,
2003, net revenue increased $187,000 to $23.1 million, or 0.8%, when compared to
net revenue of $23.0 million for the corresponding period in 2002. Total dental
group practice revenue increased $467,000, or 1.4% to $32.8 million for the nine
months ended September 30, 2003 compared to $32.4 million for the nine months
ended September 30, 2002. EBITDA for the nine months ended September 30, 2003
and 2002 was $3.5 million.
The Company had anticipated third quarter total dental group practice revenue
growth in the 3% to 4% range versus the actual growth of 1.4%. The Company
believes that the difference between the actual and expected revenue growth is
the impact of jobs being lost in its markets over the past few years. To combat
any further economic softness, the Company is actively exploring ways to
increase revenue growth, including; increased marketing, acquisitions of group
or individual practices, and de novo practice development. Fred Birner, CEO,
commented "We believe that the effect of the job losses in our primary Colorado
market has finally trickled down to our level, but we are taking the necessary
steps to ensure more robust revenue growth in the future. We are pleased that
the cost cuts and cost containment initiatives we have taken over the past two
years have allowed the Company to maintain profitability in a down market."
Birner Dental Management Services, Inc. acquires, develops, and manages
geographically dense dental practice networks in select markets in Colorado, New
Mexico, and Arizona. As of September 30, 2003 the Company managed 54 dental
offices, of which 37 were acquired and 17 were de novo developments. The Company
operates its dental offices under the PERFECT TEETH name.
The Company previously announced it would conduct a conference call to review
third quarter ended September 30, 2003 results. In addition to current operating
results, the teleconference may include discussion of management's expectation
of future financial and operating results. The call will be held on Tuesday,
November 4, 2003, at 9:00 a.m. MT. To participate in this conference call, dial
in to 1-800-937-6563 and refer to "Birner Dental Management Services, Inc."
approximately five minutes prior to the scheduled time. If you are unable to
join in on the conference call on November 4th, the rebroadcast number is
1-800-839-0860 with the pass code of 1080. This rebroadcast will be available
through November 18, 2003.
Certain of the matters discussed herein may contain forward-looking statements
that are subject to certain risks and uncertainties that could cause actual
results to differ materially from expectations. These and other risks are set
forth in the reports filed by the Company with the Securities and Exchange
Commission.
For Further Information Contact:
Birner Dental Management Services, Inc.
Dennis Genty
Chief Financial Officer
(303) 691-0680
BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
Quarters Ended September 30, Nine Months Ended September 30,
--------------------------------- -------------------------------
2002 2003 2002 2003
----------- ----------- ----------- -----------
NET REVENUE (a) $ 7,558,588 $ 7,537,951 $22,959,798 $23,147,179
DIRECT EXPENSES:
Clinical salaries and benefits 2,895,670 2,915,517 8,833,681 8,929,258
Dental supplies 455,705 449,927 1,354,664 1,373,100
Laboratory fees 580,334 573,194 1,801,312 1,842,320
Occupancy 859,540 888,577 2,554,425 2,622,545
Advertising and marketing 95,826 82,100 256,481 275,758
Depreciation and amortization 600,974 528,144 1,794,200 1,675,630
General and administrative 790,908 776,146 2,365,842 2,305,234
----------- ----------- ---------- -----------
6,278,957 6,213,605 18,960,605 19,023,845
----------- ----------- ----------- -----------
Contribution from dental offices 1,279,631 1,324,346 3,999,193 4,123,334
CORPORATE EXPENSES:
General and administrative 689,802 736,430 2,277,607 2,348,128
Depreciation and amortization 84,436 71,998 247,615 226,747
----------- ----------- ----------- ----------
Operating income 505,393 515,918 1,473,971 1,548,459
Interest expense, net 79,673 34,572 274,704 123,220
Income before income taxes 425,720 481,346 1,199,267 1,425,239
Income tax expense 161,774 182,911 455,722 541,590
----------- ----------- ----------- ----------
Net income $ 263,946 $ 298,435 $ 743,545 $ 883,649
=========== =========== =========== ==========
Net income per share of Common Stock:
Basic $ .18 $ .24 $ .50 $ .66
=========== =========== =========== ==========
Diluted $ .16 $ .21 $ .46 $ .60
=========== =========== =========== ==========
Weighted average number of shares of
Common Stock and dilutive securities:
Basic 1,471,646 1,260,181 1,493,840 1,335,773
========= ========= ========= =========
Diluted 1,617,310 1,388,321 1,629,786 1,465,854
========= ========= ========= =========
a) Total dental group practice revenue less amounts retained by group
practices. Dental practice revenue was $10,804,631 for the three months
ended September 30, 2003 compared with $10,654,028 for the three months
ended September 30, 2002 and was $32,838,705 for the nine months ended
September 30, 2003 compared to $32,371,722 for the nine months ended
September 30, 2002.
BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, September 30,
ASSETS 2002 2003
------------- -------------
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 1,072,757 $ 846,846
Accounts receivable, net of allowance for doubtful accounts
of $212,803 and $222,582, respectively 2,708,231 2,817,379
Deferred tax asset 120,622 120,622
Prepaid expenses and other assets 738,119 327,758
----------- -----------
Total current assets 4,639,729 4,112,605
PROPERTY AND EQUIPMENT, net 3,926,422 2,898,620
OTHER NONCURRENT ASSETS:
Intangible assets, net 15,496,271 14,922,429
Deferred charges and other assets 167,098 152,597
----------- -----------
Total assets $24,229,520 $22,086,251
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 3,981,247 $ 3,945,002
Income taxes payable 30,219 305,798
Current maturities of long-term debt 2,169,713 346,912
----------- -----------
Total current liabilities 6,181,179 4,597,712
LONG-TERM LIABILITIES:
Deferred tax liability, net 24,258 24,258
Long-term debt, net of current maturities 1,087,422 3,126,096
Other long-term obligations 177,635 186,886
----------- -----------
Total liabilities 7,470,494 7,934,952
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred Stock, no par value, 10,000,000 shares
authorized; none outstanding - -
Common Stock, no par value, 20,000,000 shares
authorized; 1,434,817 and 1,201,211 shares issued and
outstanding, respectively 15,959,829 12,468,453
Retained earnings 799,197 1,682,846
----------- -----------
Total shareholders' equity 16,759,026 14,151,299
----------- -----------
Total liabilities and shareholders' equity $24,229,520 $22,086,251
=========== ===========
Although EBITDA is not a generally accepted accounting principles measure of
performance or liquidity, the Company believes that it may be useful to an
investor in evaluating its performance. However, investors should not consider
this measure in isolation or as a substitute for operating income, cash flows
from operating activities or any other measure for determining the Company's
operating performance or liquidity that is calculated in accordance with
generally accepted accounting principles. In addition, because EBITDA is not
calculated in accordance with generally accepted accounting principles, it may
not necessarily be comparable to similarly titled measures employed by other
companies. A reconciliation of EBITDA can be made by adding Depreciation and
Amortization Expense, Depreciation and Amortization Expense - Corporate,
Interest Expense, Net and Income Tax Expense to Net Income as in the table
below.
Quarters Ended September 30, Nine Months Ended September 30,
------------------------------- ----------------------------------
2002 2003 2002 2003
------------ ------------ ------------- -------------
RECONCILIATION OF EBITDA:
Net Income $ 263,946 $ 298,435 $ 743,545 $ 883,649
Depreciation and amortization 600,974 528,144 1,794,200 1,675,630
Depreciation and
amortization - Corporate 84,436 71,998 247,615 226,747
Interest Expense, Net 79,673 34,572 274,704 123,220
Income Tax Expense 161,774 182,911 455,722 541,590
------------ ------------ ------------- -------------
EBITDA $ 1,190,803 $ 1,116,060 $ 3,515,786 $ 3,450,836
============ ============ ============= =============